Farmers Insurance Withdraws Coverage in Florida.

July 12, 2023: Farmers Insurance, a major insurance company, has reduced its coverage in Florida. This move will have consequences for state residents currently holding auto, home, or umbrella insurance policies with the company.

According to Trevor Chapman, a spokesperson for Farmers Insurance, the company has informed the Florida Office of Insurance Regulation (FOIR) that it will no longer offer its Farmers-branded policies in Florida. However, this decision only affects policies issued through the exclusive agency distribution channel, and it will not impact the majority of policies currently in force for customers in the state, such as Bristol West, Foremost SignatureSM, Farmers GroupSelectSM, Foremost Choice, and Foremost-branded policies.

Farmers Insurance will communicate with the affected policyholders to provide information on the timeline for the termination of their coverage. They will also offer guidance on alternative options for obtaining replacement coverage. This decision by Farmers Insurance is considered a necessary step to effectively manage their risk exposure.

To comply with state regulations, insurance providers must provide a minimum 90-day notice to the Florida Office of Insurance Regulation (FOIR) when they discontinue offering certain types of coverage to Floridians. The FOIR is currently reviewing the notification submitted by Farmers Insurance regarding the reduction in coverage.

Approximately 100,000 policies for auto, home, and umbrella insurance that fall under the Farmers Insurance brand will be impacted by this coverage change in Florida. This decision by Farmers Insurance reflects the challenges faced by the insurance market in the state, including the insolvency of some private insurers and the voluntary withdrawal of coverage by other companies due to the difficulties posed by extreme weather conditions.

Florida Chief Financial Officer Jimmy Patronis has expressed concern about this coverage reduction and has called for additional scrutiny on Farmers Insurance. He intends to hold the company accountable for its decision and has directed his team to investigate complaints against the insurer. If the complaints meet a certain threshold, it may trigger a market conduct investigation that could lead to fines against Farmers Insurance. Patronis also expects that any canceled policies should result in a prorated refund to policyholders, and efforts are underway to explore options for a bulk transfer of policies with the Florida Association of Insurance Agents.

Farmers Insurance, founded in 1928, provides individual policies to over 19 million customers nationwide. While this decision will affect thousands of policyholders in Florida, most Farmers Insurance policies in the state will remain available through their subsidiaries, Foremost and Bristol West.